Poland: Suspension of statute of limitations; maximum tax rate for residential buildings; deduction of input VAT

The KPMG member firm in Poland prepared a report that includes summaries of the following court decisions.

• The Constitutional Tribunal on 12 December 2023 held (ref. no. SK 110/20) that provisions on suspending the statute of limitations for tax liability from date of filing a complaint to the Administrative Court, until date of delivery to the tax authority of a copy of the court's judgment declaring it is final and non-appealable (Article 70(6)(2) and Article 70(7) of the Tax Code), are in line with the Polish Constitution.
• The Supreme Administrative Court on 13 December 2023 held (case file III FSK 1070/23) that in order to apply to residential buildings or parts thereof the maximum tax rate provided for by Article 5(1)(2)(b) of the Act on Local Taxes and Duties, the actual fact of their "occupation to conduct business activities," which the tax authorities did not prove in the case under consideration, is decisive and exclusive. The court further found that “occupied to conduct business activities” has a different meaning than “related to business activities.” The premises under dispute did not lose their residential function even though they were purchased by the company and treated as goods sold within 12 months and thus could not be subject to the maximum tax rate provided for by the Act. 
• The Supreme Administrative Court on 12 December 2023 held (case file I FSK 281/23) that the expenses incurred by a company to rent accommodation and make it available for free to its employees were directly linked with the company’s activities subject to value added tax (VAT). As a result, the company was allowed to deduct the input tax from the invoices for rent payments.

Read a December 2023 report prepared by the KPMG member firm in Poland